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President Obama effectively has declared war on America’s wealth creators. By refusing to extend fully the George W. Bush tax cuts, Mr. Obama and congressional Democrats are hoping their “tax the rich” rhetoric will carry the day. This sends an unmistakable message to investors and entrepreneurs: If you risk your capital and succeed, your government will punish you. It should come as no surprise, then, that this policy has led to a dramatic destruction of wealth.

Income in the United States, as measured by gross domestic product, did grow by $58 billion during the second quarter, from April through June. The change was small in percentage terms, but at least the indicator was moving in the right direction. During the same period, however, the value of assets such as houses, stocks and pensions dropped by $1.5 trillion, according to the latest Federal Reserve data. That represents a loss of more than $19,300 for the average family of four in the course of just 90 days.

The chilling effect has rippled throughout the economy. Only one in four households expects its finances to improve in the year ahead, according to the University of Michigan survey of consumer confidence. Key sectors of the economy, including housing, are equally unpromising. “Housing starts, sales and inventory data reported for August do not show signs of a robust market, and foreclosures continue,” said David M. Blitzer, chairman of the Index Committee at Standard & Poor’s, in announcing the latest data on Tuesday.

Americans have responded to the financial hardship by cutting back. Household debt fell by 2.3 percent in the second quarter, while the federal government increased debt by 24.2 percent. The government borrowing might create the illusion of a benefit, but regret will sink in quickly as the bills come due.

There’s only one way to stop the economic slide. America must return to policies that focus on economic growth. That means cutting back on the unproductive federal, state and local government sectors that are sapping energy from the private sector. That means removing protectionist trade barriers. That means cutting red tape and absurd regulations like the Environmental Protection Agency’s war on carbon dioxide. Most of all, it means cutting taxes on capital gains as an incentive for entrepreneurs.

Speaking to congressional Democrats last week, Mr. Obama underscored the importance of the upcoming midterms for the survival of his left-wing policy agenda. “If the last election was about changing the guard,” the president said, “This is about guarding the change that we’ve initiated.” It is clear that the change we’ve seen so far has been for the worse. Nov. 2 is the chance to reverse the wealth destruction.